Yoon (2002)

From Copyright EVIDENCE

Advertising Architectural Publishing of books, periodicals and other publishing Programming and broadcasting Computer programming Computer consultancy Creative, arts and entertainment Cultural education

Film and motion pictures Sound recording and music publishing Photographic activities PR and communication Software publishing (including video games) Specialised design Television programmes Translation and interpretation

1. Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare 2. Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)? 3. Harmony of interest assumption between authors and publishers (creators and producers/investors) 4. Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption) 5. Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)

A. Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right) B. Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction) C. Mass digitisation/orphan works (non-use; extended collective licensing) D. Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability) E. Fair remuneration (levies; copyright contracts) F. Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)

Source Details

Yoon (2002)
Title: The Optimal Level of Copyright Protection
Author(s): Yoon, K.
Year: 2002
Citation: Yoon, K. The optimal level of copyright protection. Information Economics and Policy 14.3 (2002): 327-348.
Link(s): Definitive , Open Access
Key Related Studies:
Discipline:
Linked by: Piolatto and Schuett (2012)
About the Data
Data Description: This study compares three different models of copyright enforcement: no protection, low protection and high protection utilising 10 previous empirical studies. The authors then produce a model of optimum enforcement level. The study also uses data published by the Business Software Alliance from 1999.
Data Type: Secondary data
Secondary Data Sources:
Data Collection Methods:
Data Analysis Methods:
Industry(ies):
Country(ies):
Cross Country Study?: Yes
Comparative Study?: Yes
Literature review?: No
Government or policy study?: No
Time Period(s) of Collection:
  • 1978-2000
Funder(s):

Abstract

We specify the optimal level of copyright protection for an individual producer and the society as a whole. For an individual producer, the optimal level is (i) no protection, (ii) the level under which the producer’s overall profit net of the development cost is zero, or (iii) full protection. The optimal level for the society, on the other hand, critically depends on the distribution of firms’ development costs. We also show that an increase in copyright protection may increase or decrease the social welfare loss due to underutilization, while it will always decrease the social welfare loss due to underproduction.

Main Results of the Study

We first show that, contrary to the common perception, an increase in copyright protection may either increase or decrease the social welfare loss due to underutilization. In particular, we demonstrate that the optimal level of copyright protection for the underutilization problem is either no protection or full protection, depending on the relative magnitudes of producer’s marginal cost and the non-substitutability of the copy for the original, which in turn affects the marginal cost of copying. For the underproduction problem, we support the claim that an increase in copyright protection will decrease the social welfare loss due to underproduction. The change, however, is not gradual. We show that the social welfare loss due to underproduction is a step function which takes a downward jump to zero at a threshold level of copyright protection. In addition to investigating the common claims, we specify the optimal level of copyright protection for an individual producer and the society as a whole. For an individual producer, the optimal level of copyright protection is: (i) no protection, (ii) the level under which the producer’s overall profit net of the development cost is zero, or (iii) full protection. We provide conditions under which one of these protection levels is an optimal level.We also discuss the optimal level of copyright protection when there exist many firms, each of which may produce a specific copyrightable product. The optimal level of copyright protection for the society crucially depends on the distribution of firms’ development costs as well as other features of the environment.

Policy Implications as Stated By Author

  • Enforcement of Copyright protection may be increasing levels of piracy in computer software



Coverage of Study

Coverage of Fundamental Issues
Issue Included within Study
Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare
Green-tick.png
Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)?
Harmony of interest assumption between authors and publishers (creators and producers/investors)
Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption)
Green-tick.png
Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)
Green-tick.png
Coverage of Evidence Based Policies
Issue Included within Study
Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right)
Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction)
Mass digitisation/orphan works (non-use; extended collective licensing)
Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability)
Fair remuneration (levies; copyright contracts)
Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)
Green-tick.png

Datasets

Sample size: 3
Level of aggregation: copyright enforcement models
Period of material under study: 1999


Sample size: 1
Level of aggregation: Individual data
Period of material under study: 1999